USD/JPY Price Forecast – US Dollar Grinding Higher Into Resistance
US dollar has dipped on Thursday, but then turned around as the 50 day EMA is trying to offer support. We are still seen a lot of pressure so I am not buying.
The US dollar has initially pulled back a against the Japanese yen before turning around again on Thursday. That being said, we are between the 50 and the 200 day EMA indicators, which typically means trouble. Furthermore, the ¥107.50 level continues to be an area worth watching. After all, the market has seen a lot of selling pressure in that area and we must remember that the Federal Reserve continues to flood the markets with greenbacks. It is only a matter of time before the idea of resistance comes back into play, and therefore we sell off.
USD/JPY Video 14.08.20
However, this pair is a little bit different in the fact that the Federal Reserve is loose, while the competing central bank is just as bad. Because of this, this could be a very choppy situation. It is worth noting that the Japanese yen is losing strength against several other currencies at the moment, so that could continue to play happy care.
Nonetheless, it is not until we break above the 200 day EMA which is above the ¥107.50 level that I would consider buying. Right now, I am looking for signs of exhaustion that I can sell but have only had a couple of short-term trades set up. I would look for huge moves at this point, the longer-term the US dollar certainly seems to be in trouble. Furthermore, if we get some type of major “risk off” type of macro event, which let us face it here – that could happen, we could see the Japanese yen strength in any way.
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